According to Watergate burglar Eugenio Martinez (see 2:30 a.m.June 17, 1972), White House aide E. Howard Hunt, whom he calls by his old CIA code name “Eduardo” (see September 9, 1971), is ratcheting up the activities of the White House “Plumbers” operation. Martinez is not yet aware of the nature of the team’s operations, but believes he is part of a black-ops, CIA-authorized organization working to foil Communist espionage activities. Hunt gives team member Bernard Barker $89,000 in checks from Mexican banks to cash for operational funds, and orders Barker to recruit new team members. Barker brings in Frank Sturgis, Virgilio Gonzalez, and Reinaldo Pico, all veterans of the CIA’s activities against Cuba’s Fidel Castro. On May 22, the six—Hunt, Barker, Gonzalez, Martinez, Pico, and Sturgis—meet for the first time at the Manger Hays-Adams Hotel in Washington for Hunt’s first briefing. By this point, Martinez will later recall, G. Gordon Liddy, who had been involved in the burglary related to Pentagon Papers leaker Daniel Ellsberg, is involved. Hunt calls Liddy “Daddy,” and, Martinez recalls, “the two men seemed almost inseparable.” They meet another team member, James McCord, who unbeknownst to Martinez is an official with Nixon’s presidential campaign (see June 19, 1972). McCord is introduced simply as “Jimmy,” an “old man from the CIA who used to do electronic jobs for the CIA and the FBI.” McCord is to be the electronics expert. Plans to Break into McGovern HQ - Martinez says that the group is joined by “a boy there who had infiltrated the McGovern headquarters,” the headquarters of the campaign of Democratic presidential candidate George McGovern. According to Hunt, they are going to find evidence proving that the Democrats are accepting money from Castro and other foreign governments. (Interestingly, Martinez will write that he still believes McGovern accepted Cuban money.) Hunt soon aborts the mission; Martinez believes “it was because the boy got scared.” New Plans: Target the DNC - Instead, he and Liddy begin planning to burglarize the headquarters of the Democratic National Committee (DNC) in the Watergate hotel and office complex. They all move into the Watergate to prepare for the break-in. Martinez will recall: “We brought briefcases and things like that to look elegant. We registered as members of the Ameritus Corporation of Miami, and then we met in Eduardo’s room.” The briefing is “improvised,” Martinez will recall. Hunt says that the Castro funds are coming to the DNC, not McGovern’s headquarters, and they will find the evidence there. The plans are rather impromptu and indefinite, but Martinez trusts Hunt and does not question his expertise. [Harper's, 10/1974]

Maurice Stans. [Source: Southern Methodist University]In a last campaign fundraising swing before April 7, when the new campaign finance laws go into effect, Maurice Stans, the financial chief for the Committee to Re-elect the President (CREEP), launches a final fundraising swing across the Southwest on behalf of Richard Nixon. Stans solicits contributions from Republicans and Democrats alike, and tells reluctant contributors that if they do not want their donations traced back to them, their anonymity can be ensured by moving their contributions through Mexican banks. Mexico does not allow the US to subpoena its bank records. Laundering - “It’s called ‘laundering,’” Miami investigator Martin Dardis later tells Washington Post reporter Carl Bernstein on August 26, 1972. “You set up a money chain that makes it impossible to trace the source. The Mafia does it all the time. So does Nixon.… This guy Stans set up the whole thing. It was Stans’s idea.… Stans didn’t want any way they could trace where the money was coming from.” The same money-laundering system allows CREEP to receive illegal contributions from corporations, which are forbidden by law to contribute to political campaigns. Business executives, labor leaders, special-interest groups, even Las Vegas casinos can donate through the system. Stans uses a bank in Mexico City, the Banco Internacional; lawyer Manuel Ogarrio Daguerre handles the transactions. Stans keeps the only records. Confirmed by Lawyer - Lawyer Robert Haynes confirms the setup for Bernstein, and says breezily: “Sh_t, Stans has been running this operation for years with Nixon. Nothing really wrong with it. That’s how you give your tithe.” Haynes calls the fundraising trip “Stans’s shakedown cruise.” Stans uses a combination of promises of easy access to the White House and veiled threats of government retaliation to squeeze huge donations out of various executives; Haynes says: “If a guy pleaded broke, [Stans] would get him to turn over stock in his company or some other stock. He was talking 10 percent, saying it was worth 10 percent of some big businessman’s income to keep Richard Nixon in Washington and be able to stay in touch.” Haynes represents Robert Allen, who runs the Nixon campaign’s Texas branch; Allen is merely a conduit for the illegal campaign monies. It is from the Banco Internacional account that Watergate burglar Bernard Barker is paid $89,000 (see April-June 1972) and the “Dahlberg check” of $25,000 (see August 1-2, 1972). [Bernstein and Woodward, 1974, pp. 54-56]

The Nixon administration spends $8,400 on fake telegrams and advertisements to create a false impression of public support for the US mining of Vietnam’s Haiphong harbor. This will not come to light until March 1973, when a disaffected official of the Nixon campaign (CREEP) tells Washington Post reporter Bob Woodward of the operation. The false telegrams are sent to the White House and publicly presented by press secretary Ron Ziegler and other Nixon officials. In addition, CREEP purchases an advertisement in the New York Times purporting to be from a group of “concerned citizens” that attacks the Times for its opposition to the mining operation. “The [Times] ad was paid for by CREEP with 40 of those $100 bills in [CREEP finance director Maurice] Stans’s safe,” the official will say (see Before April 7, 1972). Another CREEP official will tell Woodward that the Haiphong public relations offensive “put the entire staff in overdrive for two weeks,” between creating false telegrams, busing supporters to Washington, organizing petition drives and phone campaigns, and getting supporters to call Congress. After the Post prints the story, Woodward learns that CREEP also rigged a poll conducted by Washington television station WTTG. The poll was based on sample ballots printed in the local newspapers. CREEP has ten people working for days purchasing newspapers, filling out ballots in different handwriting, and mailing them in. The fake ballots radically skew the poll in favor of the mining operation. A CREEP spokesman will confirm the ballot-stuffing operation and say, “We assumed the other side would do it also.” Frank Mankiewicz, a senior campaign aide for the presidential campaign of Democratic candidate George McGovern, will respond incredulously: “It didn’t occur to us, believe me. Those guys are something. They assume we have the same sleazy ethics as them.” [Bernstein and Woodward, 1974, pp. 265-267; GlobalSecurity (.org), 2008]

A staff member of the Committee to Re-elect the President (CREEP), G. Gordon Liddy, is fired after he refuses to answer FBI questions about his possible involvement in the Watergate burglaries (see 2:30 a.m.June 17, 1972). [Washington Post, 8/1/1972] Liddy is willing to tell the FBI that he personally misappropriated the campaign money channeled through the bank account of fellow burglar Bernard Barker (see June 21, 1972), specifically the $25,000 from CREEP finance official Kenneth Dahlberg (see August 1-2, 1972) and the $89,000 from Gulf Resources, Inc. channeled through Mexican lawyer Manuel Ogarrio (see April-June 1972 and Before April 7, 1972). Liddy is also willing to say that when CREEP discovered the money had been raised improperly, his superiors ordered him to return the money as the law requires, but instead he decided on his own to use it for covert political operations. “A true believer,” President Nixon says about Liddy. “We’ll take care of him… we’ll wait a discreet interval and pardon him.” [Reeves, 2001, pp. 512]Hunt Dodging FBI - Fellow Watergate burglar E. Howard Hunt is battling in court to avoid testifying to FBI investigators. Hunt’s whereabouts are currently unknown. [Washington Post, 8/1/1972] Hunt, a former FBI agent, worked for the White House as a member of Nixon aide John Ehrlichman’s staff until December 1971, when he joined CREEP as the committee’s general counsel. He had soon after been appointed CREEP’s financial counsel, handling legal advice on campaign finances and contributions. CREEP spokesman Devan Shumway says Hunt had no connection to the committee’s security or intelligence gathering operations. [Bernstein and Woodward, 1974, pp. 34-35]

The Washington Post reports that a $25,000 cashier’s check, apparently earmarked for the campaign to re-elect President Nixon, found its way into the Miami bank account of one of the Watergate burglars, Bernard Barker (see 2:30 a.m.June 17, 1972). [Gerald R. Ford Library and Museum, 7/3/2007]Origin of Check - The check, drawn on a Boca Raton, Florida bank, was made out to Kenneth H. Dahlberg, the finance manager for the Committee to Re-elect the President (CREEP). Dahlberg says that in early April, he gave the check to “the treasurer of the Committee [Hugh Sloan, who has since quit the committee and is cooperating with the FBI investigation] or to Maurice Stans himself.” Stans, formerly Nixon’s secretary of commerce, is CREEP’s finance chief. The money is made up of “[c]ontributions I collected in my role as Midwest finance chairman,” Dahlberg explains. “In the process of fund-raising I had accumulated some cash… so I recall making a cash deposit while I was in Florida and getting a cashier’s check made out to myself. I didn’t want to carry all that cash into Washington.” Watergate Connections - Barker withdrew much of the money from the same Boca Raton bank account, in $100 bills. 53 of those bills were found on the five Watergate burglars after their arrest. Clark MacGregor, who replaced former Attorney General John Mitchell as the head of CREEP (see July 1, 1972), says he knows nothing about the check or the money found on Barker and the other burglars: “[T]hese events took place before I came aboard. Mitchell and Stans would presumably know.” The Post also learns that another $89,000 in four separate checks were deposited in Barker’s Miami bank account in May (see June 23, 1972). The checks were originally made out to Mexican lawyer Manuel Ogarrio Daguerre, on an account at Mexico’s Banco Internacional. While looking over the story before publication, Post editor Barry Sussman says: “We’ve never had a story like this. Just never.” [Washington Post, 8/1/1972; Bernstein and Woodward, 1974, pp. 43-44]GAO Will Investigate Nixon Campaign Finances - Stans’s secretary says her boss cannot comment on the story because he is “agoniz[ing] over the confusing circumstances” and does not want to say anything that might compromise his integrity. Philip S. Hughes, the director of the Federal Elections Division of the General Accounting Office (GAO, the investigative arm of Congress), says that the story reveals “for the first time [that] the bugging incident was related to the campaign finance law.… There’s nothing in Maury [Stans]‘s reports showing anything like that Dahlberg check.” Hughes says his office intends to fully audit the Nixon campaign finances. [Bernstein and Woodward, 1974, pp. 45-47]

The General Accounting Office (GAO) completes its preliminary report on financial irregularities inside the Nixon re-election campaign (see August 1-2, 1972). According to the report, the campaign has mishandled over $500,000 in campaign contributions, including an apparently illegal “slush fund” of over $100,000—perhaps more than $350,000. The report lists 11 “apparent and possible violations” of the new campaign finance law (see Before April 7, 1972), and refers the matter to the Justice Department for possible prosecution. The GAO agrees to delay its public issuance of its report after the committee’s finance chairman, Maurice Stans, asks GAO chief investigator Philip Hughes to come to Miami, where the Republican National Convention is in full swing, to receive more information. Another GAO investigator tells Washington Post reporter Bob Woodward that the Nixon campaign does not want the report to be made public on the same day that Richard Nixon accepts the Republican nomination for president. [Bernstein and Woodward, 1974, pp. 48-56]

President Nixon responds to the report by the General Accounting Office (GAO) alleging possible illegal campaign finances in his re-election campaign (see August 22, 1972). Nixon tells reporters, “[W]e have a new law here in which technical violations have occurred and are occurring, apparently on both sides.” When asked what illegalities the Democrats have committed, Nixon says: “I think that will come out in the balance of this week. I will let the political people talk about, but I understand that there have been [violations] on both sides.” The financial director of his re-election campaign, Maurice Stans (see Before April 7, 1972), is an honest man, Nixon says, and is currently investigating the matter “very, very thoroughly, because he doesn’t want any evidence at all to be outstanding, indicating that we have not complied with the law.” Between the GAO’s and the FBI’s investigations, Stans’s own internal investigation, and an internal White House investigation by White House counsel John Dean, Nixon says there is no need for a special Watergate prosecutor, as some have requested. Of the Dean investigation: “I can say categorically that his investigation indicates that no one on the White House staff, no one in this administration, presently employed, was involved in this very bizarre incident [the Watergate burglary—see 2:30 a.m.June 17, 1972]. What really hurts in matters of this sort is not the fact that they occur, because overzealous people in campaigns do things that are wrong. What really hurts is if you try to cover it up.” [Bernstein and Woodward, 1974, pp. 57; Gerald R. Ford Library and Museum, 7/3/2007] A Washington Post story on the press conference highlights Nixon’s use of the phrase “presently employed,” and notes that several people suspected of campaign wrongdoing—G. Gordon Liddy, E. Howard Hunt, Maurice Stans, Hugh Sloan, and John Mitchell—no longer work for the administration. [Bernstein and Woodward, 1974, pp. 57] An assistant attorney general is convinced that the Dean investigation is “a fraud, a pipeline to [White House aide H. R.] Haldeman.” [Bernstein and Woodward, 1974, pp. 206] In April 1973, an associate of Dean tells Washington Post reporter Bob Woodward that there was never any such investigation, that Dean had not even discussed anything to do with Watergate as of August 29. “There never was a report,” the associate says. “Dean was asked to gather certain facts. The facts got twisted around to help some other people above him.” [Bernstein and Woodward, 1974, pp. 297-298] Dean later tells Watergate investigators that he never conducted any such internal White House investigation (see June 3, 1973). [Washington Post, 6/3/1973]

In his first interview session with former President Richard Nixon about Watergate (see April 13-15, 1977), David Frost moves from the erased Watergate tape (see November 21, 1973) to Nixon’s damning conversation with Charles Colson about “stonewalling” the Watergate investigation. This time around, Frost is far more prepared and ready to deal with Nixon’s tactics of obfuscation and misdirection than in earlier interviews (see April 6, 1977). Surprise Information - Nixon is unaware that Frost knows about his conversation that same day with Colson (see June 20, 1972). Along with what is known about his conversation with Haldeman, the Colson conversation puts Nixon squarely in the midst of the conspiracy at its outset. More important than Frost’s command of the facts is Frost’s springing of a “surprise card” (Frost researcher James Reston Jr.‘s words) on Nixon at the beginning of the Watergate sessions. Nixon obviously must contend with the questions of what else Frost knows, and how he would ask about it. As Frost details excerpts from the Colson conversation, about “stonewalling” and “hav[ing] our people delay, avoiding depositions,” Reston watches Nixon on the monitor. Reston will later recall: “His jawline seemed to elongate. The corners of his mouth turned down. His eyes seemed more liquid. One could almost see the complicated dials in his head turning feverishly. It was a marvelously expressive face. The range of movement both within the contours of the visage and with the hands was enormous.” Frost concludes with the question, “Now, somewhere you were pretty well informed by this conversation, weren’t you?” After some fumbling and half-hearted admissions of some knowledge, Nixon begins justifying his actions in the conspiracy: “My motive was not to cover up a criminal action, but to be sure that as any slip over—or should I say slop over, a better word—any slop over in a way that would damage innocent people or blow it into political proportions.” [Reston, 2007, pp. 124-126]Pinning Nixon down on CIA Interference - Frost asks about the conversations of June 23 (see June 23, 1972), when Nixon told his aides to have the CIA interfere with the FBI’s investigation of the burglary. Nixon tries dodging the point, emphasizing how busy he was with other matters that day and quibbling about the definition of the phrase “cover-up,” but finally says that he had no criminal motive in ordering the CIA to stop the FBI from investigating the matter of the Mexican checks found in Watergate burglar Bernard Barker’s bank accounts. He was merely engaged in political containment, he says, and besides, two weeks later, the FBI traced the checks to a Mexican bank anyway (see Before April 7, 1972 and August 1-2, 1972). Nixon emphasizes his instructions to then-FBI director L. Patrick Gray to move forward on the investigation (see July 6, 1972). (Later, Nixon staff member Jack Brennan will admit that they had almost convinced Nixon to admit to the illegality of the June 23 orders, but Nixon had demurred.) 'You Joined a Conspiracy that You Never Left' - It now falls to Frost to confront Nixon with the strictures of the law and the evidence that he had broken those laws. Frost says, “But surely, in all you’ve just said, you have proved exactly that that was the case, that there was a cover-up of criminal activity because you’ve already said, and the record shows you knew, that Hunt and Liddy [E. Howard Hunt and G. Gordon Liddy, the leaders of Nixon’s “Plumbers”] were involved… you knew that, in fact, criminals would be protected.” Nixon protests, “Now just a moment,” but Frost says, “Period.” Frost lectures Nixon on obstruction of justice, saying: “The law states that when intent and foreseeable consequences are sufficient, motive is completely irrelevant.… If I try to rob a bank and fail, that’s no defense. I still tried to rob a bank. I would say you tried to obstruct justice and succeeded in that period” between June 23 and July 6. Nixon retorts that he does not believe Frost knows much about the details of the obstruction of justice statutes, but fails to move Frost, who has been carefully instructed in the obstruction statutes all week. Frost eventually says: “Now, after the Gray conversation, the cover-up went on. You would say that you were not aware of it. I was arguing that you were part of it as a result of the June 23 conversation.” Nixon repeats, “You’re gonna say that I was a part of it as a result of the June 23 conversation?” Reston later writes, “It was a crucial moment, a moment that took considerable courage for David Frost.” Frost replies: “Yes.… I would have said that you joined a conspiracy that you never left.” “Then we totally disagree on that,” Nixon retorts. Reston later writes: “No journalist in America, I concluded, would have had the courage of Frost in that vital moment. But therein lay the failing of American journalism. For Frost here was an advocate. He was far beyond the narrow American definition of ‘objective journalism.’” [Time, 5/9/1977; Reston, 2007, pp. 124-126]

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